CoinJar experience from a novice: Part 1, setting up account and CoinJar Swipe

Greetings friendly and knowledgeable Steemit community.

I thought I would share my experiences as a novice getting into using Coinjar as a way to buy or sell Bitcoin with AUD from my bank account, and use Bitcoin for everyday payments with their 'Coinjar Swipe' card, which works as an EFTPOS card (to our overseas readers it would probably be called something else, like 'debit card'(?)). Prior to this the only way I would get Bitcoin would be through VirWox, using USD or GBP or EUR or CHF to buy Linden Dollars (SLL), and then BTC, and then transfer to an exchange or wallet. Obviously there were a number of transaction fees along the way, but also with CoinJar - I was glancing at it just before and it's about $100 AUD premium of buy price over sell price ($5,3XX versus $5,2XX). I honestly never compared the two to see which is the more expensive to buy BTC with, but I would say CoinJar would win, as with VirWox there are also PayPal transaction fees, to do with currency exchange, and its simpler to do everything from one location, also without the transactions limits VirWox has as well. Another thing with CoinJar is the rewards, which generate after buying BTC with AUD, and can be used to offset transaction costs.

CoinJar only offers AUD and other world currencies, and BTC - but no ETH or other Altcoins. I know Coinbase offers ETH and LTC, but that is US based, and requires a US bank account.

While I can't recall all the details, I do know that it took some time (not quite forever, but nearly, it seemed), to get my account verified. This was done sometime in the last 3 months.

You start off just with email and password, then mobile phone and 2FA. Then confirm you bank account, similar to the way PayPal does it, by quoting back to them the value of 2 small transactions they send to your account (a few cents). In order to be able to buy BTC or get a CoinJar Swipe, you need to verify your identity in a way that is quite stringent. Copy of Driver's License and proof of address (recent), as well as clear photo of you holding your Driver's License (or perhaps other ID), and also a piece of paper with CoinJar, and the date marked on it. After what seemed like ages, a few weeks I guess, I was verified and good to go. I must admit I thought about just giving up during that time, but happily I stuck with it.

Then, the cost is $29 to get a CoinJar Swipe card, and it takes about a fortnight to get to you, it is sent with a PIN, and some details about fees. Mainly the fee structure is free for cash withdrawal or balance enquiry at non rediATMs, and $2.00 at rediATMS. $4.00 inactivity fee (1st day of each month of 180 days of inactivity), and $10.00 for a disputed transaction. Signing up to CoinJar Rewards is instantaneous.

Next, transferring money (or should I say 'currency' if we choose to remember the wise words of Robert Kiyosaki) from our bank account into CoinJar. There seem to be 2 main ways to do it, BPAY and POLi. I recall doing BPAY from a NAB account, which didn't take that long, maybe 3 days, and POLi from CBA, and that took the better part of a week, and once it did hit CoinJar it stayed as 'pending' for a few days before being spendable. So if you want to act quickly on a BTC bull market and the money (yeah, OK, 'currency') is not already in your CoinJar cash account, forget it, you need to have it there ready to spend well in advance.

Now. With some cash in the account I thought I would make use of the opportunity to protect against inflation, or the loss of value of the currency I would use to buy goods and services with (AUD) over time, by spending BTC instead, which has been rising in value against the USD and AUD all year, but basically since its inception if you take a long term trend perspective. I would achieve this by buying BTC and loading the value onto my CoinJar Swipe EFTPOS card.

CoinJar doesn't really explain how this works, but the way I, eternal optimist (or gullible noob, whichever one you think... ) thought it worked was that you could actually load BTC onto the card, and have that BTC, as stored value, appreciate in value against the dollar as it sits there. Then the BTC gets instantly converted to AUD at point of sale when you buy something, hence giving you the opportunity to passively benefit from increased purchasing power. Feel free to correct me in the comments section but...

APPARENTLY NOT.

How it works is, the BTC converts back to AUD, and gets stored on the card AS AUD.

So if you did like I did the first time, ie, transferred AUD to CoinJar cash account, THEN bought BTC, THEN 'topped up' the CoinJar Swipe card, you would just lose money in transaction fees - I started off with $500, then ended up with $490 basically, lost $10 right off the bat (but did collect 45 CoinJar Rewards points). I could have simply transferred the $500 as cash to my card and lost / gained nothing. And then what would be the point, I could just use my regular EFTPOS card from my bank for the same effect.

SO. If you did want to increase (or 'not lose') your purchasing power when shopping for groceries, fuel, whatever...

You would transfer AUD to your CoinJar cash account, then wait for a dip in the price of BTC, buy 1 BTC (say at $5,000 AUD), and wait and hold until the price (sell price, not buy) goes up to $5,200 AUD (these days that can happen within the day). THEN top up your CoinJar Swipe. Excluding transaction fees, you now have $5,200 AUD of purchasing power instead of $5,000, an extra $200. Since you most likely be spending that $5,200 in one hit, maybe over a period of a few months depending on your budget, you'd be better off transferring say, 0.25 BTC every fortnight to the card as the value of BTC appreciates, to make further purchasing power gains (provided it's a bull market for BTC over that period).

It's a great idea, but I can't really understand how it's any different from buying BTC with AUD at $5,000 some other way, then selling at $5,200, receiving the money into my bank account and using my regular EFTPOS card to make purchases, as I could have done that without a CoinJar Swipe. Convenience of everything in one spot, Rewards program I guess? The real benefit CoinJar provides, to me anyway, is the ability to move AUD between your bank account and your CoinJar cash account for the purpose of buying or selling BTC. The EFTPOS card and the Rewards program are simply a convenient bonus.

CoinJar also has a 'Hedge Account' feature available to all users. I guess that's the other way to do it. It's in BTC, and would lock to a certain AUD amount. I haven't used it so far. Maybe best to discuss in a future post once I've had a go with it. Maybe the key to all this is clever use of the Hedge Account (?).

I will also update once I have successfully used the card at the shops. And hopefully when I have successfully proven to have increased purchasing power with the help of BTC, and CoinJar, with a real life example, as 'proof of concept'.

I've always wondered (as I'm sure all of you have) whether the technical proficiency required, clunkiness of wallets, etc and concept that is so foreign to most people would ever stop cryptocurrency from gaining broad acceptance as a currency (or even 'money'). For instance, I have above average education, curiosity in alternative ways of doing things, and a passion for truth and freedom, but I really struggle to get my head around even the basics, I never hear people around me discuss crypto at all, and people who are 50+, forget it the vast majority wouldn't even know what it is let alone know how to use it.

So I think there is a long way to go yet, but CoinJar is a promising concept, with the EFTPOS card bringing the idea closer to the average person's everyday experience. Of course it won't make retail banks redundant on its own as you still need to have a regular bank account unless you can somehow get paid your entire income in BTC, and never need to receive any AUD electronically.

Comments, corrections, suggestions, welcome.